The brokerage firm lowered the target price to $13 from $16, citing lower savings from GM's recent health-care agreement with the United Auto Workers union.

That would represent a fall of an additional 33 percent this year for GM's stock, which was one of the worst performers in the Standard & Poor's 500 index in 2005, dropping almost 52 percent.

The shares were down 74 cents, or 3.8 percent, at $18.68 on the New York Stock Exchange after falling as low as $18.47 earlier in the session. GM's decline weighed on the blue-chip Down Jones industrial average.

GM has said the health-care pact, endorsed by the union in October, will cut its health-care expenses by $3 billion annually before taxes, and reduce its hourly health-care liability by 25 percent, or by about $15 billion.

"GM's estimate of a $15 billion reduction in the health-care liability, due to the agreement, assumes the agreement lasts in perpetuity," Banc of America analyst Ron Tadross said in a note to clients.

"Apparently, the agreement ends in 2011," he said.

The eventual savings from the deal will be only about $7 billion before taxes, he said.

Calls to GM spokesmen were not immediately returned.

GM shares have been under pressure as the company struggles with high health-care and commodities costs, loss of U.S. market share to foreign rivals, and sinking sales of SUVs, its long-time profit generators. The world's largest automaker lost nearly $4 billion through the first nine months of 2005.

Moreover, the shares have been falling steadily since news of the sale of 12 million GM shares by billionaire Kirk Kerkorian's investment arm, Tracinda Corp. , last month. Tracinda reduced its stake in the company to 7.8 percent from 9.9 percent, citing income tax savings.

Banc of America also cut its target price for Ford Motor Co. (F) shares to $7 from $8, but raised its target price for Toyota Motor Corp. to $113 from $110.